Creative Pricing by Florida Utility Hopes To Expand Solar Market

Gainesville Regional Utilities will become the nation’s first utility to offer a feed-in tariff for generation of electricity from solar photovoltaic energy. Starting on March 1, the Florida municipal utility will sign new power purchase agreements for up to 4 MW per year. Sellers with a building- or pavement-mounted installation will receive a guaranteed fixed rate of 32¢ per kilowatt-hour for 20 years. The rate for a free-standing installation will be 26¢ per kWh. GRU has a program offering a rebate of $1.50 per installed watt, with up to 14¢ per kWh paid for excess power sold back to the utility, a system called "net metering." But the utility felt the feed-in tariff would offer sellers a better return on investment, encouraging faster growth in solar PV. GRU also estimates that installing 4 MW of PV panels will generate $24 million of revenue for solar contractors and designers, says Edward J. Regan, assistant general manager for strategic planning. In Germany, a federal feed-in tariff has made the country the leading PV installer, with more than 3,830 MW, according to the Worldwatch Institute.

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